Over the next decade, the Tax Cuts and Jobs Act will reduce federal revenues by $1 trillion from CBO’s estimate of last June. Spending increases will add another $500 billion to the debt. In 2018 alone, tax cuts and spending hikes will add $242 billion to the federal budget deficit. As a result, the annual deficit will top $1 trillion in just two years and rise to $1.5 trillion by 2028. But below those headline numbers, there are other important nuggets and caveats. Many can be gleaned by comparing CBO’s latest report with its forecast of last June. Here are five take-aways from the new report:

Economic effects of fiscal stimulus: CBO is projecting that the combination of an already-strengthening economy plus tax cuts and new spending will sharply boost Gross Domestic Product, but only temporarily. The agency projects the economy will grow by 3.3 percent from the fourth quarter of 2017 to the fourth quarter of 2018, significantly higher than its estimate of 2.0 percent of a year ago.

But CBO figures annual growth will slow later in the decade, largely as a result of the higher deficits created by those tax cuts and spending hikes. For example, a year ago, it projected the economy would grow at an average annual rate of about 1.9 percent from 2021-2027. According to the latest estimate, it will average about 1.7 percent for the same period. This is not only a decline from a year ago, but it is barely half the growth rate predicted by President Trump.

The composition of taxes. We knew that cutting corporate taxes was a top priority of the authors of the TCJA. The CBO report shows how just deep those tax cuts will be. In 2020, for example, CBO projects that individual income tax revenues will fall from its 2017 estimate of $1.933 trillion to $1.833 trillion, or about 5 percent. Corporate tax revenues for 2020 will decline from its 2017 projection of $380 billion to $307 billion, or nearly 20 percent.

Big caveat #1: economic assumptions. As my Tax Policy Center colleague Bill Gale notes here, CBO’s forecast assumes the economy averages full employment over the next decade. Not only is the economy strong today, but CBO projects it will operate at or above its potential growth rate for most of the rest of the decade (though it will fall below potential for a couple of years in the middle of the period). The problem: For the past half-century, full employment deficits averaged 2.3 percent of GDP. For the rest of this decade, CBO projects they will run at more than twice that.

Big caveat #2: future spending and taxes. The CBO forecast assumes current law. That is: All the individual income tax cuts and some of the business tax cuts in the Tax Cuts and Jobs Act will expire as scheduled before 2026. In addition, the one-year spending increases approved by Congress this year will also be reversed. But nobody really thinks that either will happen.

The CBO report also includes different assumptions (called the current policy baseline) that get much less attention. If instead of maintaining current law, Congress increases spending for discretionary programs (excluding programs such as Medicare, Medicaid, Social Security, and interest on the debt) just to keep up with inflation, spending over the next decade would boost the debt by another $1.7 trillion. Extending some key provisions of the TCJA that are scheduled to expire would add another $772 billion to the debt. In 2028 alone, the combination would add nearly $500 billion to the deficit, even before additional interest on the extra debt. Over the decade, these more realistic assumptions would add nearly $15 trillion to the debt.

Big caveat #3: trade. CBO assumed a modest decline in US exports from the strong levels of 2017. But CBO did not try to project the effects of a trade war on exports or jobs, or of the higher costs to US consumers of imported goods.

Because it is impossible to predict whether President Trump will follow through on his threats of higher tariffs or the extent to which China and other targeted countries would retaliate, there is no way to project with any certainty the effect on the US economy. However, the Penn Wharton Budget Model forecasts that a full-blown trade war would reduce GDP by 0.9 percent by 2027 and by 5.3 percent by 2040, relative to pre-Trump policy.

CBO’s headline deficit projection is bad news. But in some ways it masks even worse news. The deficit risk is asymmetric—chances are much higher that CBO’s official baseline is understating the problem than that it is overstating it. And that danger deserves everyone’s attention.

Posts and comments are solely the opinion of the author and not that of the Tax Policy Center, Urban Institute, or Brookings Institution.